Friday, March 13, 2009

The Ef Word

Stimulus bill gives cold shoulder to SBIR program

By Efrain Viscarolasaga

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The Small Business Innovation Research program, and its cousin, the Small Business Technology Transfer program, were created with a specific aim in mind — to help small, innovative companies team with government agencies and large contractors to bring new technologies to market, while also giving the small businesses the capital needed to grow.

Yet in two weeks, at a time when small business needs all the help it can get, the program could disappear. The bill creating the program was due for reauthorization last fall, but some in-fighting among federal representatives prevented a new bill from being signed. Currently working under a “continuing resolution,” the reauthorization is due again for signature on March 20, yet has been buried behind the stimulus bill and other, seemingly more immediate, matters. But comments from industry insiders indicate there is a real possibility the reauthorization won’t get signed.

What’s more, President Barack Obama’s stimulus package — aimed at generating jobs and supporting small companies — is proving to be a hindrance to the SBIR program, rather than a support. Buried among the reams of funding in the stimulus bill is a section granting $7.5 billion to the National Institutes of Health to fund research. But that funding comes with a stipulation — it cannot be used for certain projects, including the SBIR program. (Incidentally, the document doesn’t even name the SBIR program by its common name, but rather uses the laws by which it was created — 15 U.S.C. 638(f)(1) and 15 U.S.C. 638(n)(1) — a move seen by some industry bloggers and supporters as an underhanded trick aimed at slipping the provision into the bill unnoticed.)

The fact of the matter is the SBIR and STTR programs are integral to the development of small technology companies in this country. Eliminating the program could have a detrimental effect on small technology and engineering companies both in New England and the rest of the nation. If the administration is dedicated to its claims that small businesses and advanced technology development are keys to generating jobs and helping to pull the nation out of the downward spiral in which it finds itself, proven, successful programs such as SBIR and STTR should be supported, not buried.

By almost every criteria, the program has been successful. According to Ann Eskesen, president of the Innovation Development Institute in Swampscott and holder of possibly the most extensive database of SBIR information in the country, the SBIR and STTR programs have provided small technology companies with more than $26 billion in funding since the programs were launched in 1982. Over that time, nearly 18,000 firms have taken part, with 6,244 currently active in at least one project. Those companies have also garnered more than 67,500 patents.

In New England, 727 firms are currently working under at least one SBIR grant, according to Eskesen. Local companies currently working on SBIR projects include carbon nanotube material developer NanoComp Inc., ethanol developer Qteros Inc. (formerly SunEthanol), and anti-infectives developer RiboNovix Inc. Past participants of the program based in New England include solar equipment maker Spire Corp., power converter developer SatCon Technology Corp., thin film photovoltaic developer Konarka Inc., biotech giant Genzyme Corp. and robotics developer iRobot Corp.

The NIH is not the only government agency that has an SBIR program. Eleven other federal agencies, including the National Science Foundation, the Department of Energy and the Department of Defense have SBIR programs in place, and at least four — the Department of Homeland Security, the Department of Transportation, the Environmental Protection Agency and the NSF — have announced new solicitations for SBIR-funded projects in the past few weeks.

But without a reauthorization, those solicitations could come to an end.